While unchanged from NAHB's June survey, the latest index reflects a yearly increase of seven markets. Meanwhile, 78 percent of markets have seen improvement over the last year.

As of the August survey, the association estimates that housing and economic activity are running at 89 percent of their normal levels.

"Things are gradually improving," said NAHB Chairman Kevin Kelly. "As the job market grows, we expect to see a steady release of pent up demand of home buyers."

Of the three index components, permit issuance on new single-family homebuilding is lagging behind the other two, having climbed to only 43 percent of normal levels, NAHB reported.

Meanwhile, employment is outpacing the other two, thanks to the ongoing streak of national job gains above 200,000 each month.
Out of all major metros surveyed, Baton Rouge, Louisiana, remains on top, leading all others with an index of 1.39—or 39 percent better than its last normal market. Other major metros leading the list include Honolulu, Oklahoma City, Houston, and Austin.

Looking only at smaller markets, both Odessa and Midland, Texas, continue to reign, boasting index scores of 2.0 or better. Also leading are Bismarck, North Dakota; Grand Forks, North Dakota; and Casper, Wyoming.

Tory Barringer began his journalism career in early 2011, working as a writer for the University of Texas at Arlington's student newspaper before joining the DS News team in 2012. In addition to contributing to DSNews.com, he is also the online editor for DS News' sister publication, MReport, which focuses on mortgage banking news.